How a Small-town Business Became the Big Boomtown

How a Small-town Business Became the Big Boomtown

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Vital Stats

Globally, ad industry award season is known as a time when agency people get together to marvel at the world’s ‘best’, ‘most innovative’, ‘game-changing’ ideas and congratulate each other in a frenzied vanity fest.

When Neil Hart, chairman and founder, launched Boomtown in 1994, the young graphic designer and his business partner Glen Meier, MD of the Eastern Cape office, were burning with the desire to do great creative work and bring those awards home.

Fast forward 20 years, and their strategy has taken a different turn, one that has seen the agency and its team of more than 70 people maintain unfailing growth and expansion into Johannesburg.

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On top of that, their profit has doubled over the last five years. Not bad for a pair of small town boys. They attribute their success to the results they have achieved for their clients, firmly believing that there is no business that is not about the customer.

What have been some of the challenges of starting a business in a small town?

Starting a business in a town like Port Elizabeth comes with its own set of challenges.  There is less competition, but there are also fewer potential customers, and the budgets may be smaller. On the other hand, we had little competition, which gave us a big advantage. But this is the Eastern Cape – no-one came running to us.

 

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Two decades down the line, and we are one of the very few agencies based in this region that have survived. Steady expansion has seen the business grow by around 20% each year. The big, exciting stories of businesses with 500% growth are great, but those ventures are not always sustainable.

We chose to do it slowly and put measures in place to help us manage growth without imploding, and always with the client at the centre of the business. One of our key clients is the Nelson Mandela Metropolitan University (NMMU), with which we have had a relationship for 18 years.

On top of that, we have always been driven by a hunger to succeed – our business has never been bound by a small town mind-set. Our vision is driven by what is happening nationally and internationally and we measure ourselves against global standards.

Boomtown-Neil-Hart

What caused that early strategy re-think?

Within the first year or two of launching the business, we realised that awards are more about creativity than effectiveness.

As in any industry, we had to be able to offer our clients effectiveness that can only be measured by return on investment: How much do you make for each advertising rand that you spend? It required a different approach to how we would position and grow Boomtown into the strategic brand agency it is today and helped us to get the clients we wanted.

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How did you build your client list?

We used direct marketing to build the client base. However, we were very specific about the clients we wanted to work with.

The objective was to be the right agency for the right client – it’s a tenet that we live by. If there is no fit, we cannot add value, and we will not target that client. We carefully built a list of the clients we wanted, including ten key accounts.

Today we have most of them as clients. Yes, they are good clients for our business, but we have focused strongly on how we can do well for their business. Failure to do that can result in damaging your reputation which, in any sector, can be fatal.

Ten years ago we were able to forecast for the year ahead based on about 30% of the clients; today that figure is 70% because of the relationships we have nurtured and the clients who spend with us consistently as a result.

Why direct marketing?

It goes back to building that ‘dream’ client list. Early on, we created a really compelling piece of direct marketing which took a lot of work, given that we were graphic designers with no experience in direct marketing principles. We chose direct marketing because it builds a direct, close relationship with customers.

This has proven to be a cost-effective way of expanding our market share. It also has the great advantage of being relatively easy to monitor as we have always been able to measure the results and work out how effective a campaign has been.

Our direct marketing initiatives talk to clients in a language they understand, and they are extremely targeted and tailored for the audience we are aiming at. We also ensure that the right decision-makers receive our communication. It’s a step-by-step process.

For example, we decided several years ago that we wanted to enter the mining and engineering sector. We wrote down the names of the clients we wanted, and we went after them, identifying who we needed to speak to – always the decision-makers – and what we had to offer in line with their needs. We bagged one of them and won an Assegai award for the campaign we created for the company.

You’re both strong proponents of PR. How has it helped you?

Boomtown-Glen-Meier

Our PR strategy has helped us to build the brand nationally. From the early days, as the business started to pick up and we had good stories to tell, we spoke about our successes. In many ways, our own business started to evolve as our offering to clients became more sophisticated and strategic.

As our reputation grew, so our services developed into a strategic business offering. Also, because we used direct marketing as our primary marketing tool, we had to build our brand at the same time, or we would risk not being taken seriously. If done intuitively, PR infuses marketing and communication with believability.

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What is the biggest challenge you’ve had to learn?

Eight years ago we started an agency in Nigeria. Unfortunately, we were not prepared for the operational challenges involved.

We found a partner to represent Boomtown in the country; he brought in some great business and we did some good work, but we had huge problems with debt collecting and were simply not strong enough in the region to get it right.

Eventually we started charging deposits, but that made us feel uncomfortable and we pulled out. We still have a desire to expand into Africa. This was probably too early for us. It was a failure, but not a waste. If we had to do it again, we might look at countries that are a bit tamer than Nigeria. Also, you cannot do business on the continent without being immersed in the local culture.

How has your strategy developed over time?

Over the last 12 years we have become more strategically minded around marketing and branding. We sit with clients and discuss where they are, where they need to go and how we are going to get them there.

We have a clear strategic process. We meet with them at the beginning of their financial year and plan what needs to be done for them to achieve certain results. That encompasses: How we grow their brand, how we grow their sales, and how we strengthen their customer relationships.

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Monique Verduyn
Monique Verduyn is a freelance writer. She has more than 12 years’ experience in writing for the corporate, SME, IT and entertainment sectors, and has interviewed many of South Africa’s most prominent business leaders and thinkers. Find her on Google+.